Cleared Funds
Cleared funds are money that has actually settled in your account and can no longer be reversed, not just a balance that shows as paid. A cheque can still bounce after it first appears to land.
What it means
A payment can show in your account before it’s actually cleared. A cheque, in particular, can look like it’s landed and then bounce days later, taking the money back out again — the deposit was never actually cleared funds, whatever the balance briefly showed.
The gap matters most for anything you hand over once you think you’ve been paid — keys, materials, or a finished job released early. Wait for funds to actually clear before you treat a payment as final, especially for a method, like a cheque, that can still reverse after it first appears to land.
A client’s $600 cheque shows in your account on Tuesday. It bounces on Friday, and the $600 disappears again — the money was never cleared funds in the first place.
Handing over a finished job, keys, or materials the moment a payment appears, before it’s actually cleared — a cheque, or a disputed card payment, can still be reversed after it first looked like it landed.
See also
Where this shows up
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